How many Fixed Rate ISAs can I have?

What is a Fixed Rate ISA?

A Fixed Rate ISA is a type of savings account where your money earns a fixed interest rate for a set period, usually between one and five years. This means the interest rate won’t change during your fixed term, even if the Bank of England changes the base rate or your savings provider changes its rates across its other savings accounts.

This can make Fixed Rate ISAs a good choice if you want to save for a designated goal, or you want to make it hard to touch the money so you’re not tempted to spend your savings on other things. You’ll earn a guaranteed rate of interest for the agreed time period, and your money is locked away so you can’t touch it!

The downside of a Fixed Rate ISA is that you usually won’t be able to make any withdrawals until the end of the fixed period. If you do need to access your money early, you’ll often pay a penalty and have to close your account. Many providers restrict your deposits, too. You’ll usually be able to make just one lump sum deposit at the start of your term and that’s it. 

We’re looking to change that, with our flexible and competitive Fixed Rate Cash ISA, coming soon!

Learn more: What is an ISA and how do they work?

Can I have more than one Fixed Rate Cash ISA?

Yes, as of April 2024, you can now open and pay into more than one Fixed Rate Cash ISA in the same tax year. So you could in theory open a 5-year Fixed Rate Cash ISA today, a 1-year Fixed Rate Cash ISA in a few months' time, and a 2-year Fixed Rate Cash ISA next year - or any other combination of fixes. You can also subscribe to multiple Stocks & Shares ISAs and Innovative Finance ISAs in the same year, and one Lifetime ISA per year. 

But keep in mind that no matter how many ISAs you have, you’ll still be restricted to the same £20,000 ISA allowance, meaning you won’t be able to deposit more than this across all your ISAs combined until the following tax year.

Learn more: When does your ISA allowance reset?

Why open more than one Fixed Rate ISA?

Opening multiple Fixed Rate Cash ISAs can be a smart way to spread your savings across different terms (e.g. a 1-year fix and a 3-year fix). It can also help you take advantage of rate changes throughout the year, and manage your cash flow by staggering maturity dates.

Can I transfer old ISAs into a Fixed Rate ISA?

Yes, and if you made the deposits in previous tax years, you can transfer your savings to a new Fixed Rate ISA without reducing your £20,000 annual allowance for the current tax year.

Whatever you do, don’t just withdraw your savings and redeposit them in the new ISA. To protect your savings’ tax-free status, ask your new provider to complete the transfer for you. 

Does each Fixed Rate ISA have to be from a different provider?

Not necessarily. Some providers will let you open multiple Fixed Rate ISAs with them in the same tax year. Others might limit you to one product per person.

If you’re planning to open more than one, it’s worth checking the provider’s terms or spreading your money across different banks or building societies. 

FAQs

How many Fixed Rate ISAs can I open in a tax year?
As many as you like, as long as you stay within your £20,000 ISA allowance.

Can I pay into more than one Fixed Rate ISA at once?
Yes. Since April 2024, you’re allowed to pay into multiple ISAs of the same type in the same tax year, including multiple Fixed Rate Cash ISAs.

Can I open a Fixed Rate ISA and a Lifetime ISA?
Yes, you can split your allowance across multiple types of ISAs, as long as you save no more than £4,000 per year in your Lifetime ISA and your total contributions across all ISAs don’t go over £20,000 per year.

Will Tembo accept transfers from older ISAs?
Yes, we’re building our Fixed Rate ISA with transfers in mind, so you can move funds from previous years or other providers without losing your tax-free status.